Archive for the ‘child support enforcement’ Category

Opt-Out Agreements and the Scope of the Child Support Standards Act

Monday, December 29th, 2008

If parties choose to deviate from the provisions of the Child Support Standards Act with respect to the child support paid, such deviation will be upheld by the court provided the parties complied with such formalities as including calculations of the presumptive child support amount and the reasons for deviating from the CSSA. However, the parties frequently choose not only to deviate from the child support amount calculations, and add-ons such as child care and health care costs, but also to make recalculations of child support an annual or semi-annual event, or to include other items not included within the scope of the CSSA.

In Fasano v. Fasano, 43 A.D.3d 988 (2nd Dept. 2007), the parties included an annual cost-of-living-adjustment (“COLA”), with respect to the child support paid by the non-custodial parent. The Second Department found that the parties to the agreement did not opt out of the CSSA standards with respect to basic child support, but that the COLA provision included in the agreement represented potential future deviations from the CSSA basic child support obligation. The agreement did not state the reasons for including the COLA provisions. The Appellate Division held that the COLA provision represented an opt-out from the CSSA and was directly related to the child support. Since the reasons for including the COLA provision were not included in the agreement, the opt-out was invalid. The court vacated the COLA provision, while the basic child support provision of the agreement was not vacated.

However, not all provisions dealing with financial support of the children are considered to be within the scope of the CSSA. In Cimons v. Cimons, 53 A.D.3d 125 (2nd Dept. 2008), the Second Department held that the obligation to provide for the future college expenses of the children was not part of the parties’ basic child support obligation and therefore was not subject to the CSSA requirement that any deviation from statutorily-mandated child support obligations must be recited and explained in a stipulation of settlement. While the parties’ agreement regarding basic child support violated the CSSA by failing to recite and explain the reasons for the deviation, the provision concerning future college expenses was enforceable. The court held that unlike the basic obligation to provide child support, payment for a child’s college education is not mandatory. Absent a voluntary agreement, a parent might be required to provide support for his or her child’s attendance at college, but the determination of that obligation is dependent upon the exercise of the court’s discretion in accordance with Domestic Relations Law §240(1- b)(c)(7). The court further noted that the determination as to which additional aspects, if any, of the parties’ stipulation must be vacated along with the basic child support provision depends on the circumstances of the particular case and the nature of the obligations addressed in the other provisions of a stipulation. Some provisions may be so directly connected or intertwined with the basic child support obligation that they necessarily must be recalculated along with the basic support obligation. It found that unlike child care expenses and unreimbursed health care expenses, education expenses were not directly connected to the basic child support calculation and did not require the appropriate opt-out language.

The above cases represent the dangers involved any time the parties attempt to either opt-out from the CSSA or attempt to include items outside of the scope of the CSSA in their agreement. Any such agreement must be carefully drafted to make sure that it is not subsequently challenged and invalidated.

Bankruptcy and Divorce

Sunday, November 30th, 2008

When your ex-spouse files for bankruptcy, all efforts to collect any debts have to stop unless they fit within one of the exceptions in the bankruptcy statute. This is known as the “automatic stay.” One exception to the automatic stay is the one that allows the commencement or continuation of a proceeding to establish or modify a support award or collect support from property that is not property of the bankruptcy estate. 11 U.S.C. 362(b)(2).

Current support debts survive a bankruptcy without the need for you to have to go to bankruptcy court. Under the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005, among the changes in creditor priority is that unpaid child support and alimony has priority over any other creditor, including taxes owed. If you are owed back support it is very important that you file a “proof of claim” with the bankruptcy court to receive payment.

The bankruptcy law requires the trustee in bankruptcy, if there is a claim for a domestic support obligation in a case, to provide written notice to the party to whom the domestic support obligation is owed, and to the state’s Child Support Enforcement Agency. A notice at the time of filing and a second notice at the time of discharge are required. In the notice to the creditor, the trustee must provide contact information for your state’s Child Support Enforcement Agency.

The new bankruptcy law made non-support obligations from a divorce or separation non-dischargeable in a chapter 7 bankruptcy, if the discharge of the obligation would harm the spouse to whom the obligation is owed more than it would harm the person who owes it, your ex-spouse. 11 U.S.C. 523(a)(15). A debt that is non-dischargeable means that your ex-spouse is still responsible for it. You would need to file a complaint in bankruptcy court to get the property settlement debt excepted from discharge. If you don’t file a claim with the bankruptcy court, the debt may be wiped out and you won’t be able to collect it later.

The discharge in a chapter 13 case is somewhat broader than in a chapter 7 case. Debts dischargeable in a chapter 13, but not in chapter 7, include debts arising from property settlements in divorce or separation proceedings.

How do bankruptcy courts decide what’s a support obligation and what’s a property settlement? The courts have based their decisions on such questions as:

Does the obligation terminate or reduce with the occurrence of certain events, like remarriage or a child turning 18?
Is the obligation in installments or a lump sum?
Are there minor children?
What is the relative health and education of the parties?
Was there a need for support at the time of the divorce?

The way in which the judgment of divorce is drafted can reduce the chance that the bankruptcy court will discharge the debt. The likelihood that the debt will not be discharged by labeling the debt payments as either support or alimony in the decree.

If you’re listed as a creditor on your ex-spouse’s bankruptcy petition, you should receive notice from the bankruptcy court of the filing and information about the date and time of the first meeting of creditors (known as a “341 meeting”). You should also receive information on the deadline for filing a claim and a proof of claim form for filling out.

Failure to Pay Child Support and Federal Criminal Liability

Friday, October 3rd, 2008

In a case of first impression, defendant, the father of twin daughters, was convicted by a jury in the Federal Court for the Southern District of New York of two counts of willful failure to pay a court ordered child support obligation in violation of 18 USC §228(a). One of the questions of first impression for the Second Circuit Court of Appeals was “whether violation of a single child support order which covers two children gives rise to one or two violations of 18 USC §228.” Conviction is affirmed on one count, vacated on the second, and the matter remanded for resentencing. When Congress leaves a statute ambiguous as to the proper unit of prosecution, “the ambiguity should be resolved in favor of lenity.” Here, because the statute does not clearly distinguish between a “support obligation” and a “court order,” defendant’s willful failure to comply with the underlying order of support for his two daughters justifies the prosecution of only one count for willfully violating an order of support, rather than two counts for failing to pay support for his twin daughters. USA v. Kerley. Decided 9/25/08.

Family Court and Willful Failure to Pay Child Support

Monday, September 15th, 2008

There is a presumption, applicable to child support enforcement proceedings in Family Court that a party, against whom a child support order was issued, has sufficient means to support his/her minor children. See Family Court Act § 437. The evidence that the party directed to pay child support has failed to pay support as ordered, constitutes “prima facie evidence of a willful violation”. Family Court Act § 454(3)(a). Once the petition alleging willful violation of a child support order was filed in the Family Court, the burden then shifts to respondent to adduce some competent, credible evidence of his/her inability to make the required payments. If the requisite showing is not made, the party will be found to have willfully failed to pay child support. Once this finding is made, the party is liable to a range of penalties, including attorneys fees and possible incarceration.

This presumption does not apply to child support enforcement proceedings brought in Supreme Court under the Domestic Relations law. If an enforcement proceeding is brought in Supreme Court, the usual remedies sought are a judgment for any unpaid arrears, attorneys fees and, possibly, a finding of contempt. The burden of proof applicable to contempt proceedings is much higher than that applicable to the proceedings brought under Family Court Act § 437.

Calculations of Child Support in New York

Monday, September 15th, 2008

The New York courts use a statutory guidelines to determine what child support amount the non-custodial parent is obligated to pay. The guidelines as applicable to the Supreme Court in actions for separation and divorce are contained in Domestic Relations Law §240 and its counterpart for the Family Court is contained in Family Court Act §413. New York child support amounts are based partly on the non-custodial parent’s adjusted gross income and partly on how many children are on the order. The court determines the non-custodial parent’s gross income, and then deducts from that amount Medicare, social security tax, New York City or Yonkers tax, and other allowable deductions to establish the non-custodial parent’s adjusted gross income. An identical calculation is performed with respect to the income of the custodial parent. The court then multiplies the combined adjusted gross income by the standard guideline percentage for the number of children. These percentages are 17% for one child, 25% for two children, 29% for three children, 31% for four children, and at least 35% for five or more children. Subsequently, that child support amount is multiplied by the ratio of non-custodial parent’s adjusted gross income to the combined adjusted gross income.

The standard guideline is applied to most parental earnings up to $80,000 (minus certain local and social security tax amounts). This includes any worker’s compensation, disability payments, unemployment benefits, social security payments, and many other forms of income. Beyond $80,000, the courts determine whether or not to use the percentage guidelines, and may consider other factors in determining the full support amount.

The State of New York provides for interest on missed payments and adjudicated arrears at a rate of 9% per year, but only on arrearages reduced to a money judgment by the courts.

New Child Support Surcharge

Wednesday, August 6th, 2008

New York has recently made changes to its child support enforcement statutes to comply with the new federal requirements. Changes to the fee for child support enforcement services followed a new federal requirement. The states are required to charge an annual fee of $25 in every child support case in which $500 is collected during the federal fiscal year. The fee applies only to those for whom the support is being collected and who never received public assistance. For those who have received pubic assistance, the statute increases the pass-through charge from $50 to $100, as of Oct. 1, 2008, and to $200 as of Jan. 1, 2010, when two or more children are involved.

Criminal Penalties Related to Child Support

Friday, August 1st, 2008

New York has recently amended two sections of the Penal Law, §260.05 and §260.06, which make it a crime for a parent to voluntarily reduce his or her income, terminate employment or fail to seek employment to circumvent an order of child support. Specifically, §260.05, non-support of a child in the second degree, provides that:

A person is guilty of non-support of a child when:

1. being a parent, guardian or other person legally charged with the care or custody of a child less than sixteen years old, he or she fails or refuses without lawful excuse to provide support for such child when he or she is able to do so, or becomes unable to do so, when, though employable, he or she voluntarily terminates his or her employment, voluntarily reduces his or her earning capacity, or fails to diligently seek employment; or
2. being a parent, guardian or other person obligated to make child support payments by an order of child support entered by a court of competent jurisdiction for a child less than eighteen years old, he or she knowingly fails or refuses without lawful excuse to provide support for such child when he or she is able to do so, or becomes unable to do so, when, though employable, he or she voluntarily terminates his or her employment, voluntarily reduces his or her earning capacity, or fails to diligently seek employment.

Penal Law §260.06 makes such failure to support a felony if a person was convicted of violating Penal Law §260.05 within the last 5 years. Such charges are available in conjunction with other remedies available to the recipient of child support under the Family Court Act, the Domestic Relations Law and the Judiciary Law. Both sections take effect on November 1, 2008.